Credit Builder Basics: Everything you need to know

By Chime Team
September 1, 2020

If you don’t know, now you know: We offer a credit card! It’s called Credit Builder –  and it’s a no fee, 0% APR secured credit card that helps you build your credit. 

Whether you’re just hearing about it, or you’re ready to jump on the waitlist, we’ve gathered our most common Credit Builder questions – to give you the lowdown. 

Let’s get to it. 

  1. The waitlist
  2. Using Credit Builder
  3. Credit Builder and your credit score
  4. Ready to build the credit you always wanted? 

The waitlist

To get the Credit Builder card, you’ll have to do 3 things:

1 –  Have a Chime Spending Account

2 – Join the waitlist (In the Chime app)

3 – Make sure you have received a direct deposit of more than $200 in the past 45 days 

If you haven’t set up direct deposit with Chime yet, you can still join the waitlist – you just won’t get the official invite until you set up that direct deposit.

Who can join the waitlist? 

Anyone with a Chime Spending Account is welcome to join!

The same way a waiting line works in person, your position on the list is based on when you joined it. (If you were to join today and your friend joined yesterday, he/she will be a bit in front of you.)

Moving to the top of the list 

We invite members off the waitlist on an ongoing basis. Once you’re on the list, all you have to do is wait. 

Skip the wait! There’s a way to move to the top of the line faster 😎  Invite your friends to Chime! Once they enroll, we’ll bump you to the front of the line.

💚 Sign up on the waitlist now and set up direct deposit to get your invitation!

Using Credit Builder

 Here are a few things to keep in mind when your Credit Builder card arrives!

Credit Builder vs. Chime debit card 

You can use your Credit Builder card for pretty much all the purchases you used to make with your debit card. Think necessities like gas and groceries, recurring bills, but also fun things too like eating out and your next new pair of shoes. There are no wrong types of purchases when it comes to Credit Builder, all purchases can help you start building credit. 

But hold onto that debit card! ATM withdrawals and SpotMe aren’t available on Credit Builder yet, so make sure to keep your Chime debit card handy too. 

How much money should you transfer to your Credit Builder Account?

That is totally up to you! However, to take advantage of all your monthly purchases to start building credit, you could  move your entire monthly spending budget to Credit Builder so all your purchases can now help you build credit. Money moved to Credit Builder will be held in a secured account and determines how much you can spend with your Credit Builder card. At the end of the month, your money in the secured account can be used to pay your balance automatically with the Safer Credit Building feature. 

If you need to withdraw cash or to use SpotMe, you can always transfer money back to your Chime online checking account instantly and use your debit card. You can make the transfer in your Chime app, from the Move Money tab.

The easiest way to move money into Credit Builder is by using Move My Pay. This feature will move the amount of your choice into Credit Builder on every payday. This way, you won’t miss a chance to use your card.

Requesting a new Credit Builder card: You might be familiar with how easy it is to ask for a new debit card using our app. Right now, this option isn't available for Credit Builder, so you will need to reach out to our support team. But we’re working on making this process better. 

Credit Builder and your credit score

Consistent use of Credit Builder can build your payment history, increase the length of your credit history over time, and has the potential to balance out your credit mix. Learn more about how this works below: 

Building credit every day 

The magic of Credit Builder is that we offer features that help you be on top of the key factors that impact your credit score. 

  • On-time payment made easy: On-time payment is a crucial aspect of building credit.  With our Safer Credit Building feature, we’ll use your money in the secured account to automatically pay your monthly charges. We report these payments to credit bureaus to help you build credit.
  • Build credit with your own money: After you make a purchase with Credit Builder, we’ll set aside that money in your secured account. You can then use that money to pay for monthly spendings – automatically. This helps you spend within your budget and avoid outstanding balances.
  • No more credit utilization: With many credit cards, high credit utilization can negatively impact your credit score. However, Credit Builder doesn’t report utilization because it doesn’t have a preset limit – you set your limit with your own money. This means, you don’t have to worry about a bad mark on your credit report because of a high utilization rate on this card. Learn more about credit utilization here. 
  • Increase credit score over time: The longer you maintain a healthy credit record, the more you are viewed as creditworthy. Start building credit with Credit Builder and have it add up for you over time.

New credit account 

Once you open your Credit Builder account, you may experience a temporary credit score decrease. This can sometimes happen because every time you open a new account that will be reported to Credit Bureaus (i.e. Experian, Transunion, and Equifax), your average credit history length goes down. 

The average credit history length is one of the factors that impact your credit score. In general, the longer an account has been open and in good standing, the better it is for your credit score. Because this is a new account, your average length of all your accounts and loans decreases. It’s important to remember that this is only one element influencing your credit score. As you make on time payment with the help of Chime Credit Builder’s Safer Credit Building feature, your credit score could improve and even surpass where it started in several months time*.

Ready to build the credit you always wanted? 

The journey of building credit can take some time. We’re here for you throughout your journey and will continue to work on creating banking features to help you achieve financial peace of mind! 💚

Opinions, advice, services, or other information or content expressed or contributed here by customers, users, or others, are those of the respective author(s) or contributor(s) and do not necessarily state or reflect those of The Bancorp Bank and Stride Bank N.A. (“Banks”). Banks are not responsible for the accuracy of any content provided by author(s) or contributor(s).

*Based on a representative study conducted by TransUnion®, members who started using Chime Credit Builder in September 2019 observed a median credit score (VantageScore 3.0) increase of 30 points by January 2020. Impact to score may vary and some users' score may not improve.

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